Researchers from the Canary Islands, basing their work on an analysis of 37 Spanish airports, have shown that the economic inefficiency of most of these is due to excessive decentralisation of airport services. “The majority of airport operators are more concerned with security parameters than with economic efficiency”, Juan Carlos Martín, a professor in the Department of Applied Economic Analysis at the University of Las Palmas de Gran Canaria and one of the authors of the study that has recently been published in the Journal of Productivity Analysis, tells SINC.
The database used as the basis for this research contains information provided by Spanish Airports and Air Navigation (AENA) for the years between 1990 and 1997. AENA has since stopped providing data for individual airports. “Throughout this period, Spanish airports had some productive inefficiencies in their operations, and should have been able to cope with more travellers and aircraft”, claims the researcher.
Efficient cost margin estimates have been used to analyse the financial viability of each airport, and how well it has adapted to the price system adopted by AENA. The study shows that economies of scale cannot be properly achieved at the sizes studied for Spanish airports, meaning production could be higher, and cost less, if the airports were larger and served more aircraft, passengers and cargo.
One airport rather than three
“What we need to do in Spain is to redirect airport policy, with operations being concentrated in a single airport in some areas, focusing on just one airport out of the existing three in regions such as Galicia, for example.”
The same problem exists in other autonomous regions such as the Basque Country, which has three airports of its own as well as being very close to those in Santander and Pamplona. The north of Spain has the highest number of airports per square kilometre of any region in Europe. “It would be much more sensible to focus on one, which could have many more connections”, the researcher explains to SINC.
The research also shows that there is indeed justification for having more than one airport in the case of the Balearic and Canary Islands, since airports represent basic transport infrastructure for these archipelagos, ensuring accessibility and tourism development in the regions.
Particularly significant are the poor efficiency levels of the airport in Cordoba, which only achieved average efficiency rates of 27%, while the remaining 73% is “pure inefficiency”, similar to those in Murcia and Vitoria, where the confidence interval of 95% is consistently below average, according to Martín.
This study also includes a case study carried out for the European Commission as part of the Sixth Framework Programme for Research, Technological Development and Demonstration within the coordinated GRACE (Generalisation of Research on Accounts and Cost Estimation) project. More information about the GRACE project can be found at: http://www.grace-eu.org.